Medicare ‘Assignment’

Medicare assignment refers to an agreement between Medicare and healthcare providers (such as doctors, hospitals, and suppliers) in which the provider agrees to accept the Medicare-approved amount as full payment for covered services or supplies. This means that the provider cannot charge the patient any additional costs beyond the Medicare-approved amount, except for any applicable coinsurance or deductible.

Here are some key features of Medicare assignment:

• Medicare assignment is voluntary for healthcare providers. Providers can choose to accept or not accept assignment on a case-by-case basis.

• When a provider accepts assignment, they agree to accept the Medicare-approved amount as full payment for the covered service or supply.

• The Medicare-approved amount is usually less than the provider's actual charge for the service or supply. The difference between the Medicare-approved amount and the actual charge is called the "excess charge."

• Providers who do not accept assignment are allowed to charge up to 15% more than the Medicare-approved amount for covered services or supplies. This is called the "limiting charge."

• Patients who receive services or supplies from providers who do not accept assignment may be responsible for paying the excess charge out of pocket, as well as any applicable coinsurance or deductible.

Example:

Suppose a patient visits a doctor who charges $200 for a covered service, but the Medicare-approved amount for that service is only $150. If the doctor accepts assignment, they agree to accept the $150 as full payment for the service, and the patient is responsible for any applicable coinsurance or deductible. If the doctor does not accept assignment, they are allowed to charge up to 15% more than the Medicare-approved amount, or $172.50 in this case. The patient would be responsible for paying the excess charge of $50.50 out of pocket, as well as any applicable coinsurance or deductible.

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